Analysis: Bitcoin Daily Chart Forms 'Death Cross,' Historically Only Occurred 10 Times

BlockBeats News, April 16th, Bitcoin formed a "Death Cross" on the daily chart on April 6th — a technical pattern where the 50-day Moving Average (MA) crosses below the 200-day Moving Average. Historically, this signal is often associated with trend reversals and expectations of a long-term bearish trend, sometimes indicating a significant market downturn.

Since its inception, Bitcoin has experienced 10 of these "Death Crosses," with the 11th one currently unfolding. Analyzing the dates and durations of these "Death Crosses" reveals an important conclusion: every bear market includes a "Death Cross," but not every "Death Cross" leads to a bear market. This distinction is key to understanding the current market environment.

Among them, the three "Death Crosses" that occurred during the bear markets of 2014-2015, 2018, and 2022 were long and painful. They lasted between 9 and 13 months, with price drops ranging from 55% to 68% from the cross to the cycle bottom.

The remaining seven crosses were much less severe. These fluctuations lasted between 1.5 and 3.5 months, with Bitcoin experiencing price drops ranging from 27% to almost none. In many cases, these signals marked a local bottom, followed by new rebounds.

James Butterfill, Research Director at CoinShares, stated that on average, Bitcoin's price is only slightly lower (-3.2%) one month after a Death Cross, with a typical increase three months later. Therefore, "the so-called Death Cross is actually often a good buying opportunity." (Cointelegraph)